Wednesday, December 8, 2021

Companies went back on CSI pledges, charged for Covid-19 services

In addition to a historic and deadly pandemic, the Ministry of Health and Wellness also had to deal with a new species of corporate social responsibility that starts off as charity and morphs into a bill.

In compliance with a High Court order, the Ministry moved its Covid-19 quarantines across the country from “uninhabitable” government facilities to commercial hospitality establishments. The just-released Auditor General’s audit report on Covvid-19 expenditure says that the Ministry “initially believed that the hotels had pledged their facilities as part of their corporate social responsibility.” However, CSI turned into business when the hotels and lodges collectively demanded P58 million payment from the Ministry for accommodating Covid-19 restrictees.

Similar pledge was made by commercial banks. After President Mokgweetsi Masisi appealed for donations from companies and members of the public, bank accounts were opened with the Bank of Botswana and eight commercial banks to facilitate the receipt of cash donations. The banks were First National Bank, Standard Chartered Bank, Stanbic Bank, Bank Gaborone, Banc ABC, First Capital Bank, Absa, and Bank of Baroda. As at 31 August 2020, a total of P126 838 038.71 in donations had been credited to the appeal fund.

In their particular case, banks are said to have “pledged not to impose bank charges, as part of their social responsibility.” Such pledge notwithstanding, “as at 31 August 2020, a total of P21 540.16 was deducted from bank accounts as bank charges. It was further observed that a large portion of these charges were cash deposit fees.” The report notes though that Bank Gaborone and First Capital bank have since reversed “most of these charges.”

Auditors could not obtain “formal documented agreements” between the commercial banks and the government. In their report they note that “lack of legal or written agreement including provisions for bank charges for these COVID-19 Relief bank accounts left room for ambiguity and banks not honouring their pledges.”

In admitting “an omission regarding collaborative expectations between the banks and Government”, the Ministry of Finance and Economic Development told the auditors that it was “not in a position to confirm this statement since we are not privy to the information and do not have such communication from banks.” Based on their knowledge of commerce and how bans practise it, the auditors conclude “one cannot expect the banks not to charge bank charges.”

RELATED STORIES

Read this week's paper